Good Afternoon. This is Roger Ghai of www.Chapter7attorneys.com . I wanted to do
a short informational video on whether you can keep your house if you file a Chapter 7 bankruptcy. I have many clients who often call me and ask me and one of their biggest
concerns, of course, is keeping their house in their Chapter 7 bankruptcy.
The general rule is, in a Chapter 7 case, if you are current on your mortgage payments
and you can show that you have the ability to pay, then you are going to be entitled to be
able to keep your home most of the time. If you are, however, behind on your mortgage
payments and you’re thinking about filing a bankruptcy, especially in these days and
times, you might want to consider, and I would urge you probably to go ahead and do a
modification of your bank note with your mortgage company before you consider filing a
chapter 7 bankruptcy case.
I wanted to talk to you, in particular, about one case that recently was decided by the
courts and it was in the case of Andrea Bowman and it was decided last year in the state
of Texas, actually, but it was applicable to all jurisdictions. One of the things that the
court looked at in that particular case was the client’s ability to pay. In that case the
court would not approve a reaffirmation agreement. What a reaffirmation agreement is,
simply, is just a new contract between you and the mortgage company that will exist after
you finish your bankruptcy case. So, in the Bowman case, actually what happened was
that the client could only show that they had only $500 per month in income.
However, the mortgage payment just itself, not including any other expenses, was
over $1200 per month. So in that particular case the court held that there was an
undue hardship that would be imposed upon the debtor if the court were to approve the
reaffirmation agreement and so in the Bowman case, actually, Mrs. Bowman was not
allowed to keep her house because she couldn’t even show enough money to make the
mortgage payment each month, much less her other personal necessary living expenses.
So the bottom line in this case really is this, if you’re current on your mortgage payment
or you can become current on your mortgage payment, then yes, you can file a Chapter 7
bankruptcy case and you do not have to have any worries or concerns about losing your
residence. Again, my final piece of advice to you on this would be try to go ahead and
do a modification and see if you can’t get a little bit more favorable terms before you file
your Chapter 7 case.
Again, I hope that you found this informational video to be somewhat useful. If you have
any questions call me at one of the Atlanta Metro offices at 770-792-1000. Thank you.
Call or text (770) 792-1000 or complete a Free Case Evaluation form